Image Exchange Process Flashcards
Define Unit of Work
Transactions are organized for processing.
This entails grouping credits/debits in balanced transactions.
based on specific FI products:
- Large corporate deposits
- Individual customer RDC
- ATM or branch deposits
- Lockbox transactions.
Define Capture
Process to read information from electronic records (standard X9 file format)
May also read MICR line from physical check
Reject/Repair
Process that attempts to correct and re-process items rejected during capture; may be due to misread MICR info
Correction of MICR data allows subsequent processing to capture information
What are inclearing items?
Received for payment
* Generally inbound items from clearing house or FRB
What are On-Us items?
Checks drawn against accounts at your FI
* Deposited to same bank where they are drawn
What are transit items?
Checks drawn against accounts at other FIs
* Separated from on-us checks during processing and sent for
collection to Paying Bank via direct presentment or via FRB
What is a file in regard to a cash letter structure?
File contains cash letters which contain bundles and in the bundles are individual checks.
A file may contain multiple files. Cash letter may contain multiple bundles.
What is a cash letter?
Group of
checks sent by a FI or
its agent to another FI,
clearing house, or FRB
office
- Contains number of
negotiable items
accompanied by
control information
What is a Bundle?
Subsets of a
cash letter usually
containing approx. 300
items (checks)
- Dollar amount of
bundle serves as a
control
- Listed on cash letter
level control totals
What are items in a cash letter?
Forward and
return checks being
sent for collection
From a depository Banks perspective, define DAY 1
Receipt/Receive items: deposits from branch, ATM, RDC, Lockbox, etc.
MICR Capture
Image Quality Analysis
Electronic (Virtual Capture) and file control
Reject repair
Balance cash letters
Transmission
Posting of on-us items
Image archive
Settlement
Reconciliation
What is Image Quality Analysis (IQA)?
Review electronic items prior to capture
To ensure items adhere to accepted quality standards
May involve both systemic and manual staff review (rejected items reviewed by staff)
MICR and image must match
Common defects during the Image Quality Analysis process.
Too light or too dark
* Streaks
* Dark or light bands covering most of the check image
* Not standard size
* Excessive skew
* Image is not in proper alignment
* Piggyback
* Two or more documents are present and overlapped
within the document image
What is Capture - File Control?
At the file lever, the system checks for duplicates.
What are image capture parameters?
Automated processing which uses business rules for:
- automatic alerts
- special requirements
- virtual sort patters
- internal control documents
- full field encoding requirements.
- image quality
- adjustment method
- indorsements
What is image capture Read/Sort
System reads electronic data record
- captures front and back of image
- provides sequence number
- indorsement
Items virtually sorted by destination
- on-us items vs transit items
What is Reject/Repair process?
Items missing MICR information
items queued for key entry. key entry of incorrect data such as MICR information.
Exceptions if require additional investigation.
What is DAY 1 from paying bank perspective?
Receive ICLs (presentment)
* Review duplicate suspects (duplicate detection)
* DDA posting
* Image archive
* Settlement
Day 1 Paper Item Processing Functions
Receipt
Proof/Encoding
Setup
Capture/sort
Repair
Balancing
Posting/Transit
Settlement
Reconciliation
Float management
What is receipt?
The physical movement of paper cash letters
- receipt of electronic cash letters between banks
- receipt from front office operations ATM, lockbox, branches.
What is Proof and encoding?
Prepares unencoded deposits from branches, internal departments, vault, ATMs, corporate deposits, etc for the capture process.
- Encode amount and missing MICR information
- Balancing - to verify transactions from where they were received (branches, ATMs, ect)
What is setup?
Process that reviews work that has already been encoded, either by proof & Encoding staff or pre-encoded by customers and adds internal control documents to prepare for capture process.
Reviewing:
Customer pre-encoded work
Inclearing work
Special sorts
What are special sorts?
Examples:
Controlled Disbursement
Lockbox
Special handling customer deposits
Large dollar item review
